Peabody v. Maguire

Trustee process. Attachment. Goods in bonded warehouse. Sales. Conditional sales. Waiver. Conflict of laws. Amendment of trustee writ. Practice. Property in bond for storage in the United States custom house, is not subject to actual attachment by a state officer, although it is in the constructive possession and control of the consignee. While thus situated it may be subject to trustee process. A sale and delivery of goods on condition that the property is not to vest until the purchase money is paid or secured, does not pass the title till performance of the condition, and if the condition is not fulfilled, the vendor may repossess himself of the goods, not only as against the vendee, but also against his creditors. So if the property is to be paid for by cash or note on delivery, the payment of the money or giving of the note is a condition precedent to the passing ■ of the title; and until that is done, or waived, no title passes. Where delivery and payment are to be simultaneous, and the goods are delivered with the expectation that the price is to be paid immediately, which is not done, tire seller is entitled to put an end to the contract and reclaim the goods. But although a sale is conditional, the vendor may waive the condition of the sale, anil by so doing pass the title. When the condition is shown to have been waived the sale becomes absolute, and vests the title in the purchaser. Even in a conditional sale the mere fact of delivery, without performance by the purchaser of the conditions of sale, and without anything being said about the condition, although it may afford presumptive evidence of an absolute delivery and of a waiver of the condition, yet it may be controlled and explained, and is not necessarily an absolute delivery, or a waiver of the condition. This is a question of fact to be ascertained from the evidence, and, like any other fact, may be proved either directly or inferentially from circumstances. The law of the country where the contract is made, is the law for its interpretation and construction, although its performance may be demanded in a foreign j urisdiction. Where no foreign law is proved which shows that the rights of the parties are to be affected in any manner different from the law of the country v here the remedy is sought, the court will assume that their rights are to be determined in accordance with those laws existing in the country where the remedy is sought. When a writ is sued out against one only of two members of a copartnership, and served upon the alleged trustees of said copartnership, no valid attachment is created against the partnership property in the hands of the alleged trustees. As soon, however, as such writ is amended by leave of court, by joining the other partner as a defendant, the alleged trustees still continuing to hold the property, then all the necessary parties being before the court, and no rights of third parties having intervened, the previous attachment becomes valid as to the property in the hands and possession of the said trustees. As against a claimant who appears and claims the property in the hands of the trustee, the plaintiff', if he prevails in holding the property, is entitled to costs from the time such claimant appears claiming the property in dispute.

On report from the superior court. The case is stated in the opinion. The following are the laws of Canadá referred to in the opinion which were introduced as evidence in the case : (Copies of Laws.) [Seal.] Article 1998 of the Civil Code of Lower Canada in fofce sincethe first of August, 1866. "The unpaid vendor of a thing has two privileged rights : 1st. A right to revendicate it. 2nd. A right of preference upon its price. In the ease of insolvent traders, these rights must be exercised within fifteen days after the sale.” It was held in the superior court at Montreal, by Justice Eainville, in the case of Thibandeau and als. v. Mills and al. on the twenty-eighth day of February, 1883, as follows : "Considering that under the terms of Art. 1998 of the Civil Code of L. C., the vendor of a thing unpaid may exercise two privileges : 1st, that of its revendication ; 2nd, that of preference on its price. "Considering that under the terms of Art. 2000, the unpaid vendor, if he has lost his right to revendicate, or if he has sold with a term, keeps his privilege on the product of a thing against all creditors except the lessor and the bailee. "Considering that it is proved that the goods in question at the time of their return to the vendor by the vendee, were in the same state as at the time of their delivery, separated from all the other goods of the said Chaput and Masse, entire and bound with ropes, and that there is no doubt as to their identity. "Considering that under the terms of the Art. 1543, C. C., the vendor of a moveable property has a right to the cancelling of the sale, for default of payment of the price, so long as the thing sold remains in the hands of the buyer. " Considering that the parties have without fraud cancelled the said agreement or sale, by mutual consent, and that the said Chaput and Masse have executed beforehand what the law would have obliged them to do, and that the plaintiffs did not suffer any prejudice from that transaction in so far as the effect of the exercise of the privilege of said Mills and Hutchinson, by one way or another, would have been the same. " Considering that under the terms of Art. 1998, the vendor, in •oases of insolvency under an insolvent law, faillite, can only exercise his privileges within fifteen days after the sale; that such provision applies only to cases of insolvency under an insolvent law, faillite, and not in cases of insolvency under common law, insolvabilite, the said Chaput and Masse are not insolvent traders in so far as there is no longer a law permitting to put a person in insolvency, and that in consequence the unpaid vendor is always in time to exercise his right of preference.” Maintains the said pleas, etc., etc. It was held by Mr. Justice Rainville, sitting in the superior court at Montreal, on September 7th, 1877, in the case of Thompson and Whitehead, insolvents, Thos. Darling, assignee, and W. Greenwood, petitioner, as follows, according to the report of the case, 9 R. L. p. 379 : " The petitioner, merchant of Leeds, England, presented a petition in order to recover possession of goods sold to the .insolvents and sent by the petitioner to the buyers’ agent at Liverpool and expedited by such agent to Montreal, where they were stored in the custom house; in the meantime the buyers had become insolvent. " The assignee opposed the petition on the ground that the conveyance of the goods had ceased by their delivery to the buyers’ agent at Liverpool and by their arrival at Montreal. "Many authorities were cited on both sides, among others sec. 82 of the Insolvent Act of 1875, which enacts that; 'In the preparation of the dividend sheet, due regard shall be had of the rank and privilege of every creditor; which rank and privilege, upon whatever they may legally be founded, shall not be disturbed by the provisions of this act except in the province of Quebec, where the privilege of the unpaid vendor shall cease from the delivery of the goods sold.’ " His honor granted the petition on the principle that the delivery of goods according to Art. 1543 of the C. C. means their delivery in the store and in the hands of the insolvents, and not their deposit at the custom house, and that the vendor of moveable effects has a right to revendiente goods unpaid. ” Art. 1543 is in the following terms : " In the sale of moveable things, the right of dissolution by reason of the non-payment of the price can only be exercised while the thing sold remains in the possession of the buyer, without prejudice to the seller’s right of reveudication, as provided in the title of 'Privileges and Hypothecs. ’ ” It was held in the superior court at Montreal, re Hawsioorth v. Elliott, X. L. C. Jurist, 197: "That the delivery contemplated by the 12th section of the Insolvent Act of 1864, is an actual, complete and final one, and consequently the delivery of goods to a purchaser’s shipping agent in England, for transmission to purchaser in Canada, and the entering of the goods in bond here, by the purchaser’s custom house broker, is not such a delivery as will defeat the vendor’s remedy, under the 176th and I77th articles of the Custom of Paris.” It was held in the superior court at Montreal, re The Bank of Toronto v. Kingston, XII L. C. Jurist, 216, "That the expression'fifteen day’s after the sale’ in the 1998th article of the Civil Code of Lower Canada, means after the sale and delivery. The delivery of goods sold in England to a shipping agent there, employed by the vendees, who forwards them to the vendees carrying on business in Montreal, is not such a delivery as is contemplated by the 12th section of the Insolvent Act of 1864, and such goods may be legally revendicated byr the unpaid vendors in the hands of the Grand Trunk Kailway here, although more than fifteen days elapsed since each delivery to the shipping agent.” We, Prothonotary of the superior court of the district of Montreal, hereby certify that the preceding pages contain faithful transcript of the Civil Code in force in this province and a faithful translation of judgments and reports in the way above indicated. [Stamp. Seal.] Geo. H. Xernick, Deputy Proth’y Superior Court, District of Montreal. Trastee process was the proper remedy since the lumber could Slot be come at to be attached. Harris v, Bennie, 3 Pet. 292; Oonard v. Pacific Ins. Co. 6 Pet. 262. There was a waiver of the conditions, if it was a conditional sale. Usher, Sales of Personal Property, § 204; Carleton V. Sumner, 4 Pick. 516; Smith v. Bennie, 6 Pick. 262; Fairbank tf, Phelps, 22 Pick. 539; Dresser Mfg Co. v. Waterston, 3 Met. 17; Whitney v. Eaton, 15 Gray, 227; Farl&w v. Ellis, 15 Gray, 231; Scudder v. Bradbury, 106 Mass. 427; Upton v. Sturbridge Mills, 111 Mass. 446; Goodwin v. Boston & L. R. R. Co. Ill Mass. 489 ; Haskins V. Warren, 115 Mass. 533 ; Freeman v. Nichols, 116 Mass. 309 ; Benjamin, Sales, § § 677, note f, 566 ; see Heller v. Elliot, 16 Reporter, 276 (N. J.); Chapman V. Lathrop, 6 Cowan, 110 (8 N. Y. C. L. Law ed. 849, see note) ; Lupin v. Marie, 6 Wend. 77 (10 N. Y. C. L. Law ed. 1025) ; Stone v. Perry, €0 Maine, 49; Seed v, Lord, 66 Maine, 580; Benjamin, Sales, § 594; Maker v. Campbell, 23 Wead. 372 (14 N. Y, C. L. Law «d. 402). The laws of Canada do not apply to this case. Daniel, Neg, Inst. § 866 ; 1 Burge, Com. 5 ; Bentley v, Hodge, 1 Best & Smith, 375 ; Hawkins v. Barney, 5 Pet. 457; Story, Con. of Laws, § § 414, 557, 558, 575, 576, 581, 571; Bulger v. Boche, 11 Pick. 36; 8 Pet, 361; Potter v. Brown, 5 East, 124; •2 Keut’s Com. 461; 2 Burge, Com, 778; Fox v. Adams, 5 Maine, 245; 11 Maine, 41; 71 Maine, 514; Boston Iron Co. v. Boston Loc. Works, 51 Maine, 585; May v. First Nat. Bank of Attleboro,' 7 Western Rep. 681 ; Heyer v. Alexander, 108 Ill. 385; Bhawn v. Pearce, 110 Ill. 350; Hibernia- Nat. Bank v, Lacombe, 84 N. Y. 367 ; Brown v. Knox, 6 Mo. 306 ; Upton v. Hubbard, 28 Conn. 275; Paine v. Lester, 44 Conn. 196; Warner v. Jaffray, 96 N. Y. 248; Kidder v. Tufts, 48 N. H. 121; Davis v. Pierce, 7 Minn. 13 ; McFarland v. Butler, 8 Minn. 116; Jackson v. Puttier, 8 Minn. 117, "Where payment and delivery are agreed to be simultaneous? and the payment is omitted, evaded, or refused by the purchaser on getting possession of the goods, the seller may at once reclaim them. No title passes till the terms of the sale have been complied with. Where nothing- is said about payment at the time of the purchase, the law presumes that the sale is for cash, and in such case payment and delivery are concurrent acts. "When goods are sold on time, and delivered under an agreement that they are to lie paid for in a promissory note of the purchaser, such payment is a condition precedent, and the title will not pass till it is made.” Usher on Sales, Secs. 202, 203 5 1 Benjamin on Sales, § 334. As early as 1808 this question came before the Massachusetts court; it was held that the title still remained in the vendors upon the simple ground that the plaintiffs had not received the security before the delivery of the goods, as appears by the ruling at nisi prius and the overruling of the exceptions. Hussey v, Thornton, 4 Mass. 405. in a case decided by the same court in 1827 there was a purchase of some property partly for cash and partly on credit. It was held by the court that the title never passed. Marston v. Baldwin, 17 Mass. 606. Whenever there is any question in a conditional sale whether the vendor has made such delivery as has waived the condition, the proof is upon the party claiming the sale as against the one maintaining that any waiver existed. It is the intention of the parties which governs in such cases. Riddle v. Varnum, 20 Pick. 280. This is to "be ascertained only from the terms of the agreement as expressed in the language and conduct of the parties and as applied to known usage and the subject matter. It must be manifested at the time the bargain is made.” Of course, as was said in this case, no secret undisclosed purpose on the part of the vendor to retain the title would prevent it from passing. This is not our case. Roster v. Ropes, 111 Mass. 10, 16. Now rve understand the weight of authority to be that when a sale has been made upon any particular terms or conditions, and the delivery made pursuant to that agreement, that is, in. consequence of and by reason of it, the delivery thereby becomes conditional in like manner as the sale. Smith v. Dennie, 6 Pick. 262-266. A distinction between a delivery which is unconditional after a conditional sale, and one where the condition still exists, is well taken. Burbank v. Orooker, 7 Gray, 158. Sundry cases are found in the Massachusetts reports whei'e a special agreement was proved that the property should remain, the title of the vendor until paid for in cash. Sargent v.. Metcalf, 5 Gray, 306; Blanchard v. Child, 7 Gray, 155. In another case decided in 1849, a sale of teas was made, and' the bill or parcels given by the seller to the buyer was, "Brown’s-note six months his order or four per cent off.” It will be-observed that this case, so far as the terms of the sale are-concerned, is precisely like the case at bar. The court in that case found that the title did not pass. Hill v. Freeman, 3-Cushing, 257. See also Coggill v. Hartford & New Haven R.. R. Co. 3 Gray, 545; DesJton v. Bigelow, 8 Gray, 159 Whitney v. Baton, 15 Gray, 225 ; Farlow v. Ellis, 15 Gray,. 229 ; Hirschorn v. Canney, 98 Mass. 149 ; Adams v. O’Connor• et al. 100 Mass. 515; Nelson v. Dodge, 116 Mass. 367 ;: Armour v. Pecker, 123 Mass. 143; Salomon v. Hathaway,. 126 Mass. 482. There is one authority in Massachusetts which seems to holdla contrary doctrine, but we do not think it is sustained either.by the cases cited in support of it, or by the general course of adjudication in Massachusetts. Freeman v. Nichols, 116 Mass.. 309. The case of Wigton v. Bowley, 130 Mass. 252, is in conflicts, with many other cases in Massachusetts and elsewhere, because-it contains the element of a draft attached to a bill of lading,, upon the acceptance of which draft the bill of lading was to be delivered, and not without. See also Blanchard v. Cooke, (Mass.) 11 N. E. B,ep. 83-89 (No. 1.) In such cases it has been held over and over again that the parties holding the bill of lading and draft retain the title to the 'property until the draft is either accepted or paid. National .Bank of Chicago v. Bayley,. 115 Mass. 228 ; Newcomb v. Boston & Lowell R. R. Corporation, 115 Mass. 230 ; Alderman v. Eastern R. R. Co. 115 Mass. 233; Seymour v. Newton, .105 Mass. 272 ; Marine Bank of Chicago v. Wright, 48 New York, 1; National Bank of Oreen Bay v. Dearborn, 115 Mass. :219 ; Exchange Bank of St. Louis v. Rice, 107 Mass. 37. The authorities in Maine are not numerous, but they are to ■the point: Hotchkiss v. Hunt, 49 Maine, 213-219 et seq. ;(1860) ; Stone v. Perry, 60 Maine, 48; Seed v. Lord, 66 Maine, 580. But it is well settled doctrine that when a contract is made, the laws of the jurisdiction within which it is made enter into it •so far as they appertain thereto, and the terms of the contract ¡are modified accordingly. This is especially illustrated in the question as to the effect of proceedings in insolvency under a State law, and a discharge thereof. It is established beyond question that a discharge ¡under such proceedings does not discharge any debt contracted prior to the enactment of the law which authorizes such proceedings, nor does it discharge any contract entered into between the insolvent debtor and an inhabitant of another State, provided •such inhabitant does not submit himself to the jurisdiction of the insolvent court by proving his debt. It does operate upon ¡subsequent contracts where the creditor is a resident of the •state at the time, because the statute enters into and forms a •part of the contract. Hackett v. Potter, 135 Mass. 349 ; Shoe & Leather Bank v. Wood, 142 Id. 563 ; Marwin Safe Co v. Norton (N. J.) 7 At. Bep. 417, 420, and cases cited. So far as any laws of Canada are pertinent, they are by the terms of the report to be proved by certificates. It will be seen by article 1998 of the Civil Code of Lower Canada, which includes the residence and place of business of the claimants, the residence and place of business of the vendees, and the residence and the place of business of the agent of the vendees, that the unpaid vendor of a thing has two privileged rights, first, the right to revendicate it, second, the right of preference upon its price. In re Thompson and "Whitehead, Insolvents, Darling, Assignee, and Greenwood, Petitioner, 9 It. L. p. 379, Ilawsworth v. Elliott, X. L. C. Jurist, 197, are to the effect, that delivery to the buyer’s agent does not deprive the creditor of his rights. In Greenwood v. Darling, supra, the provisions of § 1543 of the Code are cited. This contains cei'tain provisions, and carefully provides that they shall not affect the chapter containing section 1998. The same court at Montreal, following the authorities and reciting the 1998th article in a case where the goods were sold in England and delivered to the purchaser’s shipping agent there, held that such a delivery was not a delivery such as was contemplated by the statute, and that the goods might be legally revendicated by the unpaid vendor in the hands of the Grand Trunk railway in Lower Canada, although more than fifteen days had elapsed since such delivery. Bank of Toronto v. Kingston, XII. L. C. Jurist, 216. It is clear from the authorities that rights and property in goods obtained in Canada by contracts made there and the laws existing there, including the laws and rights to revendicate the same, follow the property, although it has gone into another jurisdiction, so long as such rights or property have not in any way been abandoned by the voluntary act of the party who possessed them in the original jurisdiction. But inasmuch as there is sometimes a little confusion arising as to whether any particular question is one of remedy or one of right and title to the property, and as we cannot understand the confidence which the plaintiffs seem to have in their case upon any other ground than that they have mistaken a title and vested right for a mere matter of remedy, we deem it proper to make some further allusion to the distinction between these two, in order to show that, in this case, rights arising under the circumstances, determining the title to the property are not affected by its having crossed the line. The authority of the writers is generally very explicit. See Story, Conflict of Laws, § § 272, 402, 401. Jones on Comm, and Trade Contracts, § 23 ; Bulkley v¡ Honold, 19 How. 390, 392; Walker v. Whitehead, 16 Wall. 314-317 ; Scudder v. Union National Bank, 91 U. S. 406 ; Pritchard v. Norton, 106 U. S. 124-130 ; Morgan v. N. O. M. & T. R. R. Go. 2 Woods, 244-254; 8 Meyer’s Fed. Doc. § 1200; Green v. Sarmiento, Pet. C. Ct. 74; S. C. 1 Abb. Nat. Dig-, p. 796; R. I. Central Bank v. Danforth, 14 Gray, 123; Williams v. Wade, 1 Met. 82; Judd v. Porter, 1 Maine, 337-339; So. Boston Iron Go. v. B. L. Works, 51, Maine, 585; Lindsay v. Hill, 66 Maine, 212-217; Smith v. Eaton, 36 Maine, 298-306. On the other hand it is true that what pertains to the remedy is governed by the lex fori. This doctrine and the reasons for it are fully set forth in Judge Story’s work already mentioned. Story’s Conflict of Laws, § § 572, 575, 576 (note a). Lennox v. Brown, 12 C. B. 801. There is still another reason which it seems to us is absolutely fatal to this attachment. The writ bore date on the 17th day of December, 1886. The direction of the officer was to attach the goods and estate of James Maguire, of Quebec, of the Province of Quebec, surviving partner of the firm of D. & J. Maguire, and doing business in the name of D. & J. Maguire, and while the writ was in that condition service was made upon' the same day. There is no question in this case, but that if the plaintiffs have any right to hold the goods in the hands of the alleged trustees, they must hold them as the property of the firm of D. & J. Maguire. No attachment however was ever made of the goods ■of D. & J. Maguire, but only of James Maguire. The addition •of Charles Maguire’s name cannot relate back so as to make the ■attachment good as against him, the amendment having been made after the entry of the writ in court. It was only the -defendant, James Maguire’s, property which was attached. Now it is too well settled to need any authorities that the property of an individual in firm assets consists only of his share of the assets remaining after the payment of all the debts of the firm, and, in this case, it appearing by the 6th allegation of the claimants that the firm was wholly insolvent, the attachment, even if not invalid by reason of all that has gone before and of what has already been urged, held nothing whatsoever in the hands of the alleged trustees. It has been often held that whether a trastee is chargeable depends upon the state of things existing at the time of service upon him. Mace v. Heald, 36 Maine, 135; Williams v. And. & Ken. R. Go. Id. 201; Capen v. Duggan, 136 Mass. 501. Adding a new defendant, though he be another partner in the same firm, vacates an attachment of firm property. Denny v. Ward, 3 Pick. 198.